E-rate 101:The Basics

NCompass Live – December 16, 2009

Agenda

• Overview of the program• Eligibility and discounts• Technology plans • Application forms, follow-up

processes• Common issues

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General information

• Federal Communications Commission (FCC), an independent U.S. government agency, oversees the E-rate program

• Universal Service Administrative Company (USAC), a not-for-profit, administers E-rate along with three other programs

• Schools and Libraries Division (SLD) is the part of USAC with responsibility for E-rate

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General information• Commitments for E-rate are made by funding

year, which runs from July 1 through the following June 30–E.g., FY2010 is July 1, 2010 – June 30,

2011• Commitments are capped at $2.25 billion for

each funding year–Once each year, FCC can roll over unused

funds from previous funding years into the current funding year

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General information

• Who can apply?–Schools and school districts–Libraries and library systems–Consortia – groups of eligible entities

that band together to aggregate demand and negotiate lower prices

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General information• How large are the discounts on eligible products and

services?– Discounts: 20% to 90% of eligible costs– Discount for a school or library depends on:

• Percentage of eligibility of students for National School Lunch Program (NSLP) in:– (for a school) the school– (for a library) the school district in which the

library is located • Urban or rural location of the school or library

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Discounts• NSLP data is available on the Nebraska DOE website:

http://ess.nde.state.ne.us/DataCenter/DataInformation/DataDownloads.htm#LunchCounts

• Check your Urban/Rural Status: http://www.universalservice.org/sl/applicants/step05/ urban-rural/default.aspx

• Once you know your NSLP percentage and Urban/Rural Status, use the Discount Matrix to determine your discount

• The Discount Matrix can be found at: http://www.universalservice.org/sl/applicants/step05/ discount-matrix.aspx

Discount Matrix

Percent of Eligible Students

Urban Rural

Less than 1% 20% 25%1% - 19% 40% 50%20% - 34% 50% 60%35% - 49% 60% 70%50% -74% 80% 80%75% -100% 90% 90%

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Eligible Services

What services are eligible?• Priority 1 (funded first)

–Telecommunications Services – Internet Access

• Priority 2 (funded beginning with neediest applicants first)– Internal Connections –Basic Maintenance of Internal Connections

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What is “E-rate-able”?• The FCC publishes the Eligible Services List

each year.• The services on that list are eligible for

discounts from the Schools and Libraries Division (SLD) of the Universal Service Administrative Company (USAC) to schools and libraries.

• The list can be found at the SLD site in PDF format: http://www.usac.org/sl/tools/eligible-services-list.aspx

E-rate Forms

• There are four basic forms - all can be filed online1. Form 470 (I want a service)2. Form 471 (I have chosen a service provider)3. Form 486 (I am receiving the service)4. Form 472/474 (I have paid all my bills – give me

my money!)• File forms online at:

http://www.sl.universalservice.org/menu.asp• Libraries need to keep copies of all E-rate

paperwork for 5 years after the last date of service.

Forms and DeadlinesForm or Event Deadline or Dates

Funding Year July 1 through the following June 30; Current year is 2009. Applying for 2010.

Form 470 Starts request for services. Must be posted at least 28 days before the filing Form 471.

Note (1) timeframe for all bids (2) Form 471 filing closing date. Will receive Receipt Acknowledgement Letter – RAL. January 14, 2010 is the last day you can POST a Form 470 and still comply with the 28-day waiting period.

Form 471 Tells SLD what services you want, the provider, costs, schools getting services, discount

%, contract or MTM, etc. 471 filing window will close at 11:59 p.m. EST on Thursday, February 11, 2010. Will receive Receipt Notification Letter – RNL.

PIA review SLD’s Program Integrity Assurance (PIA) staff review all applications, which can take over 8 months. PIA will contact you with questions.

FCDL sent Starting late April, Funding Commitment Decision Letters sent to applicants. This continues for months.

Form 486 Confirms start of service. Must be received/postmarked within 120 days after FCDL date or 120 days after the Service Start Date, whichever is later.

Form 472 / Form 474

Get discounts on bills (#474) or reimbursements (#472). Received or postmarked no later than 120 days after the date of the Form 486 Notification Letter or 120 days after the last date to receive service, whichever is later.

Appeals Must be received within 60 days of date on the FCDL.

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General information• Each time you file a program form, USAC sends you a letter

– Letters are color-coded by funding year• 1998 and 1999 White• 2000 Canary (Yellow)• 2001 Pink• 2002 Blue• 2003 Canary• 2004 Pink• 2005 Blue • 2006 Canary• 2007 Pink• 2008 Blue• 2009 Canary• 2010 Pink

1. Technology planning

• Note: if you are only requesting basic telephone service, a technology plan is not required

• You must write a technology plan that contains the following elements:– Goals and strategies for using technology to improve

education or library services– Staff training– Needs assessment– Budget– Evaluation plan

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Five criteria for a technology plan

• (1) Goals and strategy for using telecommunications and information technology to improve library services;

• (2) a professional development strategy to ensure that staff know how to use these new technologies to improve library services;

• (3) An assessment of the telecommunication services, hardware, software, and other services that will be needed to improve library services;

• (4) A sufficient budget to acquire and maintain the hardware, software, professional development, and other services that will be needed to implement the strategy; and

• (5) An evaluation process that enables the library to monitor progress toward the specified goals and make mid-course corrections in response to new developments and opportunities as they arise.

E-rate and Technology Plans• Technology Plans 5 criteria for E-rate -

http://www.universalservice.org/sl/applicants/step02/technology-planning/

• NLC Technology Planning Worksheet - http://www.nlc.state.ne.us/libdev/erate/ worksheet.html

• Libraries need to keep copies of the technology plan and the approval letter for audit purposes.

Technology Plans

• Must be written prior to the Form 470 filing - Should have a “creation date” that pre-dates the Form 470

• Plans must support requested services on Form 470• Should be written for 3 years but can be

updated/modified if significant changes are needed• Needs to be approved by July 1 but actually needs

to be “written” in the previous fall.• Technology plans must cover the entire funding year

for which a service is being sought. (Can’t expire before June 30, 2011)

CIPA/NCIPA Compliance (Children's Internet Protection Act)

• Compliance with CIPA required for:• Internet access • Internal connections• But not telecommunications (telephone)

• CIPA requires filtering and having an Internet Safety Plan

• SLD information on CIPA:• http://www.universalservice.org/sl/applicants/

step10/cipa.aspx

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2. Request services (470)

• You post a Form 470 to:–Open a competitive bidding process–Notify potential bidders (service providers)

of the types and quantities of services that you need

–Define the scope of your needs (e.g., a school building, a library system, a state network)

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Form 470• Must be posted for at least 28 days before

you choose a vendor, sign contracts and file Form 471

– January 14, 2010 is the last day you can POST a Form 470 and still comply with the 28-day waiting period.

• Keep track of all bids if any are received• Price must be primary factor in selecting a

phone company if you receive multiple bids.• Must file this form every year for telephone

Form 470• 470 must be filed for 2010, if…

– You have no contract for the requested services • Often tariffed or monthly telco or Internet service

– A contract expires on or before June 30, 2010 • File 470 once for length of multi-year contracts or contracts

with voluntary extensions– 470 and any RFP must indicate this

• Check 7a and b and both options under b– In out years on the 471, cite the original 470

• Be sure to file for correct category of service

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Request services (470)• Acronyms and terms

–Billed Entity Number (BEN) – an identification number assigned by USAC to each school or library building

–Personal Identification Number (PIN) – a code assigned by USAC to applicants for use in certifying program forms online• USAC issues a PIN to every new

authorized person filing a paper Form 470, 471, or 486

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Request services (470)• Acronyms and terms (cont.)

–Form 470 Receipt Notification Letter (RNL) – a letter issued by USAC to the applicant that summarizes the information provided in the Form 470

–Allowable vendor selection/contract date (ACD) – the date 28 days after the Form 470 is posted to the USAC website

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3. Competitive bidding

• When you open a competitive bidding process for your services:–Potential bidders have the information from

your Form 470 and RFP and can respond to your requests

–You must ensure that the competitive bidding process is open and fair

–You must be prepared to evaluate bids

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Competitive bidding• Must have a fair and open bidding process

– Bid document (RFP) optional, is a local decision– All vendors are treated the same; have access to same

information– Vendors cannot be involved in your 470

• Must choose most cost-effective bid– Cost must be primary factor – Non-eligible products/services not part of cost

effectiveness – Fully document your bid review process and any

decision(s)• Record dates of any decisions, actions taken, etc.

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Competitive bidding• Acronyms and terms

–Bid – A service provider response to your Form 470 and/or RFP that contains services and prices and any other information you have requested

–Price as the primary factor – In evaluating bids, the price of the eligible products and services must be the most heavily-weighted factor in your evaluation of bids

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Competitive bidding

• After you close the competitive bidding process for your services (on or after the ACD):–You can evaluate the bids received–You can choose your service provider(s)–You can sign a contract–You can post a Form 471

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4. Choose services (471)

• You post a Form 471 to:–Report information on the service

providers and services you have chosen–Provide a list of the schools and libraries

that will receive services– Include discount calculation information

including student NSLP counts–Certify your compliance with program rules

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E-rate Form 471• File after the Form 470 has been posted for at least 28 days

and contracts are signed (if the service requires a contract)• Provides specific information on services, service providers

selected, and contracts and/or agreements, costs, etc.• Must be filed each funding year

• Applicant certifies compliance with all program rules

• The FY2010 application filing window opened at noon EST on Thursday, December 3, 2009. Form 471 must be postmarked or filed online by 11:59 p.m. EST on Thursday, February 11, 2010.

• Form 470 certifications must also be filed online or postmarked before the close of the 471 filing window

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Receipt Acknowledgement Letter (RAL)

• Form 471 Receipt Acknowledgment Letter (RAL)– Cover page of important reminders– Provides confirmation of certain information

entered from Form 471• Data entry errors may be corrected within

three weeks by using the RAL (including Block 4 worksheets)

• Applicants can request funding reductions but not funding increases

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Funding Commitment Decision Letter (FCDL)

• FCDL reports status of individual funding requests:• Funded• Not funded• As yet unfunded (internal connections)• Canceled

• May receive more than one FCDL• Use info on FCDL to prepare Form 486

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Choose services (471)• Acronyms and terms

–Funding Request Number (FRN) – the identification number assigned to a Form 471 Block 5 funding request

–Service Provider Identification Number (SPIN) – the identification number assigned by USAC to a service provider• Service providers may have more than

one SPIN in order to identify separate business units, different states in which they operate, etc.

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Choose services (471)• Acronyms and terms (cont.)

– Item 21 Attachment (Item 21) – the description of services associated with a funding request (Item 21 on Form 471)

– Form 471 Receipt Acknowledgment Letter (RAL) – a letter issued by USAC to the applicant and the service provider that summarizes the information provided in the Form 471• Many of the entries on the form can be

corrected after submission by using the RAL

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5. Application review• USAC reviews your Form(s) 471 to:

–Check the eligibility of the schools and libraries and their discount levels

–Verify that the services you requested are eligible for discounts

–Give you an opportunity to make allowable corrections to your form

– In some cases, ask for additional verification of your compliance with program rules

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E-rate Reviews

• As forms are filed they are reviewed by staff at the SLD

• Contracts, dates of contracts and types of services are reviewed for compliance. (Since phone bills are “month-to month” this isn’t an issue for regular telephone.)

• Easy to get confused as to what year you are doing a form for. You could be doing forms for 3 different years at the same time.

Appeals• Funding denials can be appealed

• Generally, appeal first to the SLD• Then appeal to FCC if SLD denies appeal

• Must be postmarked within 60 days of denial on FCDL

• FCC has been granting many appeals • But can be a year or more

• See Appeals Procedure on SLD Website:• http://www.universalservice.org/sl/about/

appeals/default.aspx

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Application review• Acronyms and terms

– Program Integrity Assurance (PIA) – the USAC group that reviews and makes funding decisions on program applications

– Funding Commitment Decision Letter (FCDL) – a letter issued by USAC to the applicant and the service provider that contains commitment decisions on funding requests

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6. Start services (486)

• You post a Form 486 to:–Notify USAC that services have started

and invoices for those services can be processed and paid

–Provide the name of the TPA that approved your technology plan

–Report your status of compliance with CIPA

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E-rate Form 486• Certifies that Tech Plan (if required) has been

approved and covers the entire funding year.• Form 486 deadline is 120 days after service

starts • –OR–• 120 days after date of Funding Commitment

Decision Letter date, whichever is later • October 29 deadline for FCDL before July 1

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Start services (486)• Acronyms and terms

–Form 486 Notification Letter – a letter issued by USAC to the applicant and service provider after a Form 486 has been processed

–Children’s Internet Protection Act (CIPA) – a law with specific requirements on Internet safety policies and filtering

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7. Invoicing USAC (472/474)

• Applicants have a choice of two invoicing methods to receive discounts on eligible services:–Billed Entity Applicant Reimbursement

(BEAR) Form 472–Service Provider Invoice (SPI) Form

474

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Invoicing USAC (472/474)• BEAR Form is filed by the applicant and

approved by the service provider after the applicant has paid for the services in full–Form due October 28, 120 days after last

service date, June 30– Or 120 days after date of Form 486

Notification Letter• SPI Form is filed by the service provider after

the applicant has been billed for the non-discount portion of the cost of eligible services

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Invoicing USAC (472/474)• Acronyms and terms

–BEAR Notification Letter – a letter issued by USAC to the applicant and service provider after a BEAR has been processed

–Quarterly Disbursement Report – a report issued to the applicant detailing all invoicing activity (BEARs and SPIs) during the previous quarter

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Getting help

• Client Service Bureau (CSB)– 1-888-203-8100–Submit a Question -

http://www.slforms.universalservice.org/ EMailResponse/EMail_Intro.aspx

• USAC website – www.usac.org/sl

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Useful Links• SL News Briefs -

http://www.universalservice.org/sl/tools/ news-briefs/Default.aspx

• Tip Sheets - http://www.universalservice.org/sl/about/ tip-sheets.aspx

• Process flowchart – reminds you where you are - http://www.usac.org/_res/documents/sl/pdf/ application-process-flow-chart.pdf

Questions???

Christa BurnsSpecial Projects Librarian

Nebraska Library Commission

800-307-2665christa.burns@nebraska.gov